China Good Australia Bad?

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In January 2022 I wrote that Indonesia had stopped exporting coal to China because of a fear of not having enough to fuel its own demands.

Now here is a current article from The Overspill (link at the end) on how China is investing in solar and wind – and the consequences for Australia’s coal exports.

Article begins:

China’s wind and solar surge threatens Australian coal exports • Australian Financial Review

Ben Potter: 

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Two new reports, from global energy consultancy Wood Mackenzie and Sydney-based Climate Energy Finance, show that China is building wind and solar at twice the rate of the US and Europe combined, and also leading the way with huge energy storage installations.

The startling acceleration comes as world leaders and officials prepare to descend on Dubai for the United Nations climate change conference (COP28) and wrangle over phasing out fossil fuels and supporting developing countries’ clean energy projects.

“China’s demand for Australian exports of thermal and coking coal is set to decline structurally over the longer term due to the greening of China’s power sector and economy,” said Climate Energy Finance director Tim Buckley. “The report recommends that to minimise economic risk, Australia urgently comprehends and responds at speed to align with China’s massive investment pivot.”

China’s accelerating clean energy shift challenges Australia, which has planned for continued exports of coal and gas while cautiously backing US-led efforts to wean the West off China’s clean energy goods and commodities and build up alternative sources of supply.

Wood Mackenzie expects China to continue to command 80% of the global supply chain for solar energy until at least 2026. It says in a new report, “How China became the global renewables leader”, that the giant economy is on track to build 230 gigawatts of wind and solar power this year at a cost of $US140bn ($210bn), compared with 75GW for Europe and 40GW for the US. A gigawatt is the size of a small coal-fired power station.

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Comment from The Overspill

So much implied judgement in this piece. “Startling acceleration” – not really; China loses out from runaway climate change too. And as for China getting ahead on making renewables: Australia could have grasped that opportunity decades ago (it has lots of empty space for wind and solar). It chose not to. Cry me a river.
unique link to this extract

My Comment

So who besides Australia exports coal to China? According to S&P Global in an article from June this year:

China is prioritizing short-term energy security to avoid a recurrence of the power shortages that occurred in 2021 and 2022. The country, which relies on coal to generate two-thirds of its power, lifted its unofficial ban on Australian coal and extended zero tariffs on coal imports until the end of 2023.

Thermal coal imports have spiked as a result, with shipments from Indonesia up 65.9% year over year to 89.9 MMt, Russian shipments increasing 88.7% to 18.3 MMt, and Australian supplies rising from zero to 11.2 MMt, according to S&P Global Commodities at Sea data.

So according to this report, Indonesia is back selling coal to China, and Australia’s exports to China are a new thing.